Source: timesofindia.indiatimes.com
MUMBAI: Northeast explorer Oil India Ltd will make its first public offering of shares on September 7. Simultaneously, the government will also
dilute 10% of its equity in the firm. The price band is likely to be decided on August 25, according to investment banking sources associated with the stake-sale process.
This will be the second PSU stake sale by the government after hydel power utility NHPC, which was oversubscribed three-and-a-half times on its opening on Friday. Along with NHPC, Oil India was listed for IPO and simultaneous government stake sale during UPA-1. But the offering plans of both companies were shelved after the market tanked in the wake of global economic slowdown.
India’s second-biggest state-run oil producer after ONGC, Oil India will offer 2.64 crore equity shares to the public in its initial offering, while the government will simultaneously sell 10% of its equity in the company to other state-run refiners. Flagship refiner-marketer IndianOil Corporation will get 5%, while HPCL and BPCL will take 2.5% shares each.
Oil India will make offering of 11% fresh equity. After the stake sales, the government’s stake in the company will decrease from 98.13% to 78.5%.
The stake sale proceeds will be used to fund capex requirement for 2009-11.
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